suze orman
Photo: Robert Trachtenberg
Life insurance can provide tremendous security, but more of a good thing isn't always better. Here are a few tips.

1. You need insurance only if there are loved ones who depend on you financially. The question you need to ask is: "If I die today, would everyone be able to pay their bills?" If the answer is no, you need life insurance.

2. Never buy this type of policy on a child's life. Life insurance is financial insurance: Its purpose is to replace needed income, and your kids don't bring in an income.

3. You probably don't need life insurance forever. Once your kids are adults or you have ample savings and home equity to support your family, chances are you can skip it. I recommend term life insurance that provides coverage for ten or 20 years. Learn more at accuquote.com and selectquote.com.

4. Never make a minor the policy beneficiary. Children can't inherit money directly, so the insurance company will not make the payment, and a court will end up overseeing the money. The better move is to create a living revocable trust and make the trust the owner of the policy.

Suze Orman's latest book is The Money Class: How to Stand in Your Truth and Build the Future You Deserve (Spiegel & Grau). To ask Suze a question, go to oprah.com/omagazine_talk.

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